|SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549
FORM 10-QSB
(Mark One)
|-------------------------------------------------------------------------------

|[X] |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- |  | ---------------------------------------------------------------------------------------

|For the
      quarterly period ended March 31, 2002
OR
|------------------------------------------------------

|[   ] |  | TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|----- |  | ----------------------------------------------------------------------------------------

For the transition period from ________________ to ________________

|Commission file number: 333-59109
ABLE ENERGY, INC.(Exact name of registrant as specified in its charter)
|---------------------------------------------------------------------------------------------------------

|Delaware(State or other jurisdiction ofincorporation or organization) | 22-3520840(I.R.S. employeridentification No.)
|--------------------------------------------------------------------- | ---------------------------------------------

|198 Green Pond RoadRockaway, NJ(Address of principal executive offices) | 07866(Zip code)
|----------------------------------------------------------------------- | ---------------

|Registrants telephone number, including area code: (973) 625-1012
Not Applicable(Former name, former address and former fiscal year, if changed since last report)
Indicate
by check X whether registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.   Yes  [X]    No  [   ]
As of May 7, 2002, 2,001,250 shares, $.001 Par value per share, of Able Energy,
Inc. were issued and outstanding.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|TABLE OF CONTENTS
|-----------------

|PART I  FINANCIAL INFORMATION                                               | PAGE |       
|---------------------------------------------------------------------------- | ---- | ------
|                                                                            
|ITEM 1  FINANCIAL STATEMENTS  (UNAUDITED)                                   |      |       
|                                                                            
|Consolidated Balance Sheets as of June 30, 2001 and March 31, 2002           |      | 3 - 4 
|                                                                            
|Consolidated Statements of Operations for the three and nine
months ended    |     
|March 31, 2002 and March 31, 2001                                            |      | 5     
|                                                                            
|Consolidated Statement of Stockholders Equity nine months
            ended |     
|March 31, 2002                                                               |      | 6     
|                                                                            
|Consolidated Statements of Cash Flow for the nine months
            ended   |     
|March 31, 2002 and 2001                                                      |      | 7 - 8 
|                                                                            
|Notes to Unaudited Financial Statements                                      |      | 9 - 26

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
ASSETS
|--------------------------------------------------------------------

|                                                               | March 31,  2002  (Unaudited) | June
      30,   2001   (Audited)
|-------------------------------------------------------------- | ---------------------------- | ---------------------------------
|                                                               |                              |                                  
|                                                               |                              |                                  
|                                                               |                              |                                  
|Current
      Assets:                                          |                             
|Cash                                                           |                              | $     371,166                    
|Restricted Cash                                                |                              |                                 
|Accounts Receivable
(Less Allowance for Doubtful               |                              |                                  
|Accounts of ($209,927) at March 31, 2002 and June 30, 2001     |                              | 2,130,526                        
|Inventory                                                      |                              | 557,730                          
|Notes Receivable - Current Portion                             |                              | 34,196                           
|Miscellaneous Receivable                                       |                              | 56,417                           
|Prepaid Expense                                                |                              | 162,798                          
|Prepaid Expense - Income Taxes                                 |                              | 2,733                            
|Deferred Income Tax                                            |                              | 58,730                           
|Due From Officer                                               |                              | 44,690                           
|                                                               |                              |                                  
|Total
      Current Assets                                     |                              | 3,418,986                        
|                                                               |                              |                                  
|Property and
      Equipment:                                  |                             
|Land                                                           |                              | 451,925                          
|Building                                                       |                              | 1,096,046                        
|Trucks                                                         |                              | 2,952,918                        
|Fuel Tanks                                                     |                              | 1,190,088                        
|Machinery and Equipment                                        |                              | 514,590                          
|Leasehold Improvements                                         |                              | 557,275                          
|Cylinders                                                      |                              | 656,317                          
|Office Furniture and Equipment                                 |                              | 186,253                          
|Website Development Costs                                      |                              | 2,200,511                        
|                                                               |                              |                                  
|                                                               |                              | 9,805,923                        
|Less: Accumulated Depreciation and Amortization                |                              | 3,171,155                        
|                                                               |                              |                                  
|Net Property and Equipment                                     |                              | 6,634,768                        
|                                                               |                              |                                  
|Other
      Assets:                                            |                             
|Deposits                                                       |                              | 116,112                          
|Notes Receivable - Less Current Portion                        |                              | 211,481                          
|Customer List, Less Accumulated Amortization of ($188,122)     |                              |                                  
|March 31, 2002 and  ($188,122) June 30, 2001                   |                              | 422,728                          
|Covenant Not to Compete, Less Accumulated Amortization of      |                              |                                  
|($235,234) March 31, 2002 and  ($210,193) June 30, 2001        |                              | 48,333                           
|Development Costs - Franchising, Less Accumulated Amortization |                              |                                  
|of ($6,893) March 31, 2002 and  ($0.00) June 30, 2001          |                              | 39,062                           
|                                                               |                              |                                  
|Total Other Assets                                             |                              | 837,716                          
|                                                               |                              |                                  
|Total Assets                                                   |                              | $10,891,470                      
|                                                               |                              |                                  
|                                                              

|See Accompanying Notes
3
|------------------------

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (Contd)
LIABILITIES
& STOCKHOLDERS EQUITY
|---------------------------------------------------------------------------------------------------------

|                                                       | March 31,  2002  (Unaudited) | June
      30,   2001   (Audited)
|------------------------------------------------------ | ---------------------------- | ---------------------------------
|                                                       |                              |                                  
|                                                       |                              |                                  
|                                                       |                              |                                  
|Current
      Liabilities:                             |                             
|Accounts
      Payable                                 |                              | $  1,431,404                     
|Note Payable - Bank                                    |                              | 1,370,000                        
|Note Payable - Other                                   |                              | 500,000                          
|Current Portion of Long-Term Debt                      |                              | 614,244                          
|Accrued Expenses                                       |                              | 259,700                          
|Accrued Taxes                                          |                              | 20,215                           
|Customer Pre-Purchase Payments                         |                              | 585,897                          
|Customer Credit Balances                               |                              | 284,821                          
|Escrow Deposits                                        |                              | 10,000                           
|                                                       |                              |                                  
|Total
      Current Liabilities                        |                              | 5,076,281                        
|                                                       |                              |                                  
|Deferred Income                                        |                              | 79,679                           
|Deferred Income Taxes                                  |                              | 52,891                           
|Long Term Debt: Less Current Portion                   |                              | 1,516,457                        
|                                                       |                              |                                  
|Total
      Liabilities                                |                              | 6,725,308                        
|                                                       |                              |                                  
|Stockholders Equity:                                  |                             
|Preferred Stock                                        |                              |                                  
|Authorized 10,000,000 Shares Par Value $.001 per share |                              |                                  
|Issued - None                                          |                              |                                 
|Common Stock                                           |                              |                                  
|Authorized 10,000,000 Par Value $.001 per share Issued |                              |                                  
|and Outstanding 2,001,250 Shares March 31, 2002,       |                              |                                  
|2,000,000 Shares June 30, 2001                         |                              | 2,002                            
|Paid in Surplus                                        |                              | 5,666,836                        
|Retained Earnings (Deficit)                            |                              | (1,502,676                       
|                                                       |                              |                                  
|Total
      Stockholders Equity                       |                              | 4,166,162                        
|                                                       |                              |                                  
|Total
      Liabilities and Stockholders Equity       |                              | $10,891,470                      
|                                                       |                              |                                  

|See Accompanying Notes
4
|------------------------

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT
OF OPERATIONS
(UNAUDITED)
|-----------------------------------------------------------------------------------

|                                                | Three Months March 31, | Nine Months Ended March 31,
|----------------------------------------------- | ---------------------- | ---------------------------
|
|                                                |                        |                            
|Net Sales                                       |                        | $8,800,243                 
|                                                |                        |                            
|Cost of Sales                                   |                        | 6,688,842                  
|                                                |                        |                            
|                                                |                        |                            
|Gross Profit                                    |                        | 2,111,401                  
|                                                |                        |                            
|                                               
|Expenses                                        |                       
|Selling, General and Administrative Expenses    |                        | 1,367,605                  
|Depreciation and Amortization Expense           |                        | 290,824                    
|                                                |                        |                            
|Total Expenses                                  |                        | 1,658,429                  
|                                                |                        |                            
|                                               
|Income (Loss) From Operations                   |                        | 452,972                    
|                                                |                        |                            
|                                               
|Other Income (Expenses):                        |                       
|Interest and Other Income                       |                        | 45,446                     
|Interest Expense                                |                        | (81,531                    
|                                                |                        |                            
|Total Other Income (Expenses)                   |                        | (36,085                    
|                                                |                        |                            
|                                               
|Income (Loss) Before Provision for Income Taxes |                        | 416,887                    
|                                               
|Provision (Reduction) for Income Taxes          |                        | (3,585                     
|                                                |                        |                            
|                                               
|Net Income (Loss)                               |                        | $   420,472                
|                                                |                        |                            
|                                               
|Basic Income (Loss) Per Common Share            |                        | $           .21            
|                                                |                        |                            
|Diluted Income (Loss) Per Common Share          |                        | $           .20            
|                                                |                        |                            
|                                               
|Weighted
Average Number of Common Shares        |                       
|Outstanding - Used in Basic                     |                        | 2,000,921                  
|                                                |                        |                            
|Weighted
Average Number of Common Shares        |                       
|Outstanding - Used in Diluted                   |                        | 2,055,812                  
|                                                |                        |                            

|See Accompanying Notes
5
|------------------------

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
NINE MONTHS ENDED MARCH 31, 2002
UNAUDITED
|---------------------------------------------------------------------------------------------------------------------------------------

|                         |  | Common Stock.001 Par Value |  |        |  |           
|------------------------ |  | -------------------------- |  | ------ |  | ----------
|
|                         |  |                            |  |        |  |           
|Balance - July 1, 2001   |  | 2,000,000                  |  | $2,000 |  | $5,662,775
|                         |  |                            |  |        | 
|Shares Issued            |  | 1,250                      |  | 2      |  | 4,061     
|Net Loss                 |  |                            |  |        |  |           
|                         |  |                            |  |        |  |           
|Balance - March 31, 2002 |  | 2,001,250                  |  | $2,002 |  | $5,666,836
|                         |  |                            |  |        |  |           

|See Accompanying Notes
6
|------------------------

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOW
(UNAUDITED)
|----------------------------------------------------------------------------------

|                                                 | NINE MONTHS ENDED    MARCH 31,   
UNAUDITED
|------------------------------------------------ | -------------------------------------------
|                                                 |                                            
|
|                                                 |                                            
|Cash Flow From Operating Activities              |                                            
|Net  (Loss) - Continuing Operations              |                                            
|Adjustments to Reconcile Net Income to Net Cash  |                                            
|used by Operating Activities:                    |                                            
|Depreciation and Amortization                    |                                            
|Gain on Disposal of Equipment                    |                                            
|(Increase) Decrease in:                          |                                            
|Accounts Receivable                              |                                            
|Inventory                                        |                                            
|Prepaid Expenses                                 |                                            
|Deposits                                         |                                            
|Deferred Income Tax - Asset                      |                                            
|Increase (Decrease) in:                          |                                            
|Accounts Payable                                 |                                            
|Accrued Expenses                                 |                                            
|Customer Advance Payments                        |                                            
|Customer Credit Balance                          |                                            
|Deferred Income Taxes                            |                                            
|Escrow Deposits                                  |                                            
|Deferred Income                                  |                                            
|                                                 |                                            
|Net Cash (Used) Provided by Operating Activities |                                            
|                                                 |                                            
|                                                
|Cash Flow From Investing Activities              |                                            
|Purchase of Property and Equipment               |                                            
|Web Site Development Costs                       |                                            
|Increase in Deposits                             |                                            
|Sale of Equipment                                |                                            
|Notes Receivable - Sale of Equipment             |                                            
|Payment on Notes Receivable - Sale of Equipment  |                                            
|Note Receivable - Montgomery                     |                                            
|Other Receivables                                |                                            
|                                                 |                                            
|Net Cash (Used) Provided By Investing Activities |                                            
|                                                 |                                            
|                                                 |                                            

|See Accompanying Notes
7
|------------------------

|ABLE ENERGY,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOW (CONTD)
(UNAUDITED)
|-------------------------------------------------------------------------------------------

|                                                 | NINE MONTHS ENDED MARCH 31,UNAUDITED
|------------------------------------------------ | ------------------------------------
|                                                 |                                     
|
|                                                 |                                     
|Cash Flow From Financing Activities              |                                     
|Increase in Notes Payable - Bank                 |                                     
|(Decrease) in Notes Payable - Bank               |                                     
|Decrease in Long-Term Debt                       |                                     
|Increase in Long-Term Debt                       |                                     
|Decrease Escrow Deposit Payable                  |                                     
|Sale of Common Stock                             |                                     
|                                                 |                                     
|Net Cash (Used) Provided By Financing Activities |                                     
|                                                 |                                     
|                                                
|Net (Decrease) Increase In Cash                  |                                     
|Cash - Beginning of Year                         |                                     
|                                                 |                                     
|Cash - End of Year                               |                                     
|                                                 |                                     
|                                                
|The Company had Interest Cash Expenditures of:   |                                     
|The Company had Tax Cash Expenditures of:        |                                     

|See Accompanying Notes
8
|------------------------

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS

JUNE 30, 2001 AND
MARCH 31, 2002
|----------------------------------------------------------------------------------------------------------------

|Note 1 |  | Summary of Significant Accounting Policies
|------ |  | ------------------------------------------

| | Consolidation
and Basis of Presentation
| | ---------------------------------------

| | Change
of Fiscal Year End: The
board of Directors have elected to change the Company and Subsidiaries
year end from December 31, to June 30, to more clearly reflect the natural
business year end when the business activities have reached the lowest point in
their annual cycle. The initial year of the change was the six month short
period year end, January 1, 2001 to June 30, 2001.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Principles
of Consolidation
| | ---------------------------

| | The
consolidated financial statements include the accounts of Able Energy, Inc. and
its subsidiaries. The minority interest of 1% in Able Propane, LLC is immaterial
and has not been shown separately. All material inter-company balances and
transactions were eliminated in consolidation.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Majority
Ownership
| | ------------------

| | The
Company is the majority owner, owning 70.6% of the issued shares of a
subsidiary, PriceEnergy.Com, Inc. in which their capital investment is $25,000.
The subsidiary has established a Web Site for the sale of products through a
network of suppliers originally on the East Coast of the United States. The Web
Site became active in October 2000 (See Notes 8 and 13).
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Minority
Interest
| | -----------------

| | The
minority interest in PriceEnergy.Com, Inc. is a deficit and, in accordance with
Accounting Research Bulletin No. 51, subsidiary losses should not be charged
against the minority interest to the extent of reducing it to a negative amount.
As such, the losses have been charged against the Company, the majority owner.
The loss for nine months ended March 31, 2002 is $783,509, (See Notes 8 and 13).
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
consolidated interim financial statements included herein have been prepared by
the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | These
statements reflect all adjustments, consisting of normal recurring adjustments
which, in the opinion of management, are necessary for fair presentation of the
information contained therein. It is suggested that these consolidated financial
statements be read in conjunction with the financial statements and notes
thereto included in the Companys annual report for the year ended June 30,
2001. The Company follows the same accounting policies in preparation of interim
reports.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|9
|-

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 1 |  | Summary of Significant Accounting Policies (contd)
|------ |  | ---------------------------------------------------

| | Results of operations for the interim periods are not indicative of annual results.
| | -----------------------------------------------------------------------------------

| | Nature
of Operations
| | --------------------

| | Able
Oil Company, Able Melbourne and Able Energy New York, Inc. are full service oil
companies that market and distribute home heating oil, diesel fuel and kerosene
to residential and commercial customers operating in the northern New Jersey,
Melbourne, Florida, and Warrensburg, New York respectively. Able Propane,
installs propane tanks which it owns and sells propane for heating and cooking,
along with other residential and commercial uses.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Companys operations are subject to seasonal fluctuations with a majority
of the Companys business occurring in the late fall and winter months.
Approximately 70% of the Companys revenues are earned and received from
October through March, and the overwhelming majority of such revenues are
derived from the sale of home heating fuel. However, the seasonality of the
Companys business is offset, in part, by the increase in revenues from the
sale of diesel and gasoline fuels during the spring and summer months due to the
increased use of automobiles and construction apparatus.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Inventories
| | -----------

| | Inventories are valued at the lower of cost (first in, first out method) or market.
| | -----------------------------------------------------------------------------------

| | Property
and Equipment
| | ----------------------

| | Property
and equipment are stated at cost less accumulated depreciation. Depreciation is
provided by using the straight-line method based upon the estimated useful lives
of the assets (5 to 40 years). Depreciation expense for the nine months ended
March 31, 2002 and 2001 amounted to $826,697 and $437,404, respectively.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | For
income tax basis, depreciation is calculated by a combination of the
straight-line and modified accelerated cost recovery systems established by the
Tax Reform Act of 1986.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Expenditures
for maintenance and repairs are charged to expense as incurred whereas
expenditures for renewals and betterments are capitalized.
| | ----------------------------------------------------------------------------------------------------------------------------------------------

| | The
cost and related accumulated depreciation of assets sold or otherwise disposed
of during the period are removed from the accounts. Any gain or loss is
reflected in the year of disposal.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 1 |  | Summary of Significant Accounting Policies (contd)
|------ |  | ---------------------------------------------------

| | Web
Site Development Costs
| | --------------------------

| | Costs
of $2,200,511 incurred in the developmental stage for computer hardware and
software have been capitalized in accordance with accounting pronouncement
SOP98-1. The costs are included in Property and Equipment and will be amortized
on a straight line basis during the estimated useful life, 5 years. Operations
commenced in October 2000. Amortization for the nine months ended March 31, 2002
and 2001 amounted to $326,152 and $205,405, respectively.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Intangible
Assets
| | -----------------

| | Intangibles are stated at cost and amortized as follows:
| | --------------------------------------------------------

| | Customer
Lists of $571,000 and Covenant Not To Compete of $183,567 related to the
Connells Fuel Oil Company acquisition on October 28, 1996, by Able Oil
Company are being amortized over a straight-line period of 15 and 5 years,
respectively. The current period amortization also includes a customer list of
$39,850 and Covenant Not To Compete of $100,000 relating to the acquisition from
B & B Fuels on August 27, 1999, is being amortized over a straight-line
period of 10 and 5 years, respectively. The amortization for the nine months
ended March 31, 2002 and 2001 are $25,041 and $63,580, respectively. The
covenant Not To Compete with Connells Fuel Oil Company ended in October
2001, and was fully amortized.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
July 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets (SFAS 142). SFAS 142 requires goodwill and
other intangible assets to be tested for impairment under certain circumstances,
and written off when impaired, rather than being amortized as previous standards
required, as such, effective July 1, 2001, the Customer List will no longer be
amortized for financial statement purposes.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | For
income tax basis, the Customer Lists and the Covenant Not To Compete are being
amortized over a straight-line method of 15 years as per the Tax Reform Act of
1993.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Use
of Estimates
| | ----------------

| | The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Although these estimates are based on managements knowledge of current
events and actions it may undertake in the future, they may ultimately differ
from actual results.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|11
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 1 |  | Summary
of Significant Accounting Policies (contd)
|------ |  | ---------------------------------------------------

| | Income Taxes
| | ------------

| | Effective
January 1, 1997, all the subsidiaries, which were S-Corporations, terminated
their S-Corporation elections. The subsidiaries are filing a consolidated tax
return with Able Energy, Inc.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Effective
January 1, 1997, the Company has elected to provide for income taxes based on
the provisions of Financial Accounting Standards Board (FASB)
Statement of Financial Accounting Standards (SFAS) No. 109,
Accounting for Income Taxes, which requires recognition of deferred
tax assets and liabilities for the expected future tax consequences of events
that have been included in the financial statements and tax returns in different
years. Under this method, deferred income tax assets and liabilities are
determined based on the difference between the financial statement and tax bases
of assets and liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Concentrations
of Credit Risk
| | -----------------------------

| | The
Company performs on-going credit evaluations of its customers financial
conditions and requires no collateral from its customers.
| | --------------------------------------------------------------------------------------------------------------------------------------

| | Financial
instruments which potentially subject the Company to concentrations of credit
risk consists of checking and savings accounts with several financial
institutions in excess of insured limits. The excess above insured limits is
approximately $116,493. The Company does not anticipate non-performance by the
financial institutions.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Cash
| | ----

| | For
the purpose of the statement of cash flows, cash is defined as balances held in
corporate checking accounts and money market accounts.
| | ------------------------------------------------------------------------------------------------------------------------------------------

| | Advertising
Expense
| | -------------------

| | Advertising
costs are expensed at the time the advertisement appears in various publications
and other media. The expense was $343,342 and $441,159 for the nine months ended
March 31, 2002 and 2001, respectively.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Fair
Value of Financial Instruments
| | -----------------------------------

| | Carrying
amounts of certain of the Companys financial instruments, including cash
and cash equivalents, accrued compensation, and other accrued liabilities,
approximate fair value because of their short maturities.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 1 |  | Summary
of Significant Accounting Policies (contd)
|------ |  | ---------------------------------------------------

| | Revenue
Recognition
| | -------------------

| | Sales
of fuel and heating equipment are recognized at the time of delivery to the
customer, and sales of equipment are recognized at the time of installation.
Revenue from repairs and maintenance service is recognized upon completion of
the service. Payments received from customers for heating equipment service
contracts are deferred and amortized into income over the term of the respective
service contracts, on a straight line basis, which generally do not exceed one
year.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Computation
of Net Income (Loss) per Share
| | ------------------------------------------

| | Basic
net income (loss) per share is computed using the weighted-average number of
common shares outstanding during the period. Diluted net income per share is
computed using the weighted-average number of common and dilutive potential
common shares outstanding during the period. Diluted net loss per share is
computed using the weighted-average number of common shares and excludes
dilutive potential common shares outstanding, as their effect is antidilutive.
Dilutive potential common shares primarily consist of employee stock options.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Impairment
of Long-Lived Assets
| | -------------------------------

| | Long-lived
assets to be held and used are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of such assets may
not be recoverable. Measurement of an impairment loss for long-lived assets that
management expects to hold and use is based on the fair value of the asset.
Long-lived assets to be disposed of are reported at the lower of carrying amount
or fair value less costs to sell.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Recent
Accounting Pronouncements
| | --------------------------------

| | In June 2001, FASB approved two new pronouncements: SFAS No. 141, Business
Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets. SFAS
No. 141 applies to all business combinations with a closing date after June 30,
2001. This Statement eliminates the pooling-of-interests method of accounting
and further clarifies the criteria for recognition of intangible assets
separately from goodwill.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | SFAS
No. 142 eliminates the amortization of goodwill and indefinite-lived intangible
assets and initiates an annual review for impairment. Identifiable intangible
assets with a determinable useful life will continue to be amortized. The
amortization provisions apply to goodwill and other intangible assets acquired
after June 30, 2001. Goodwill and other intangible assets acquired prior to June
30, 2001 will be affected upon adoption. The Company has adopted SFAS No. 142
effective July 1, 2001, which will require the Company to cease amortization of
its remaining net customer lists balance and to perform an impairment test of
its existing customer lists and any other intangible assets based on a fair
value concept.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|13
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 1 | Summary
of Significant Accounting Policies (contd)
|------ | ---------------------------------------------------

| | Recent
Accounting Pronouncements (contd)
| | -----------------------------------------

| | The
Company has reviewed the provisions of these Statements. It is managements
assessment that customer lists impairment will not result upon adoption. As of
June 30, 2001, the Company has net unamortized customer lists of $422,728.
Amortization expense of the customer list was $20,125 for the six month short
year ended June 30, 2001 and $42,052 for the full year ended December 31, 2000.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 2 |  | Notes
Receivable
|------ |  | ----------------

| | A. | The Company has a Receivable from Able Montgomery, Inc. and Andrew W. Schmidt
related to the sale of Able Montgomery, Inc. to Schmidt, and truck financed by
Able Energy, Inc. No payments of principal or interest had been received for
more than one year. A new note was drawn dated June 15, 2000 for $170,000,
including the prior balance, plus accrued interest. The Note bears interest at
9.5% per annum and payments commence October 1, 2000. The payments will be
monthly in varying amount each year with a final payment of $55,981.07 due
September 1, 2010. No payments were received in the year ended December 31,
2000. In February 2001, two (2) payments were received in the amount of
$2,691.66, interest only. In September 2001, $15,124.97 was received covering
payments from December 2000 through October 2001, representing interest of
$14,804.13 and principal of $320.84
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
note is secured by a pledge and security agreement and stock purchase agreement
(Stock of Able Montgomery, Inc.), dated December 31, 1998, and the assets of
Andrew W. Schmidt with the note dated June 15, 2000. The income on the sale of
the company in December 1998 and the accrued interest on the drawing of the new
note are shown as deferred income to be realized on collection of the notes.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Maturities
of the Note Receivable are as follows:
| | -------------------------------------------------

| | For the 12 Months EndingMarch 31, |         | Principal Amount
| | --------------------------------- | ------- | ----------------
| |                                   | 2003    |                 
| |                                   | 2004    |                 
| |                                   | 2005    |                 
| |                                   | 2006    |                 
| |                                   | 2007    |                 
| |                                   | Balance |                 
| |                                   |         |                 
| |                                   | Total   |                 
| |                                   |         |                 

|14
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 2 | Notes Receivable (contd)
|------ | -------------------------

| | B. | Able Oil Company has three (3) Notes Receivable for the sale of oil delivery
trucks to independent drivers who also deliver oil for the Company. The Notes
bear interest at the rate of 12% per annum. Two notes began December 1998 and
one began February 1999. The Notes are payable eight (8) months per year
September through April, the oil delivery season.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Maturities of these Notes Receivable are as follows:
| | ----------------------------------------------------

| | For the 12 Months EndedMarch 31, |         | Principal Amount
| | -------------------------------- | ------- | ----------------
| |                                  | 2003    |                 
| |                                  | 2004    |                 
| |                                  | 2005    |                 
| |                                  | 2006    |                 
| |                                  | 2007    |                 
| |                                  | Balance |                 
| |                                  |         |                 
| |                                  | Total   |                 
| |                                  |         |                 

|Note 3 |  | Inventories
|------ |  | -----------

|Items                         | March 31,      2002 | June 30,      2001 | 
|----------------------------- | ------------------- | ------------------ | 
|                              |                     |                    | 
|Heating Oil                   |                     | $263,736           | 
|Diesel Fuel                   |                     | 26,526             | 
|Kerosene                      |                     | 7,806              | 
|Propane                       |                     | 10,797             | 
|Parts, Supplies and Equipment |                     | 248,865            | 
|                              |                     |                    | 
|Total                         |                     | $557,730           | 
|                              |                     |                    | 

|Note 4 |  | Notes
Payable - Bank
|------ |  | --------------------

| | On
October 22, 2001, the Company and its subsidiaries, either as Borrower or
Guarantor, entered into a loan and security Agreement with Fleet National Bank.
The bank is providing the following credit facility.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | A
borrowing base of 75% of Eligible Accounts Receivable, as defined in the
Agreement, plus $500,000 against the value of the Companys customer list,
for a total amount of $1,500,000. The revolving credit may also be used for
Letters of Credit, with the lenders approval.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 4 |  | Notes
Payable - Bank (contd)
|------ |  | -----------------------------

| | The
Letters of Credit will have an annual fee of 1.25% of the face value of each
Letter of Credit. The applicable interest rate on the revolving credit advances
will be the banks prime rate or Libor interest rate, plus 2.75%. Interest
is to be paid on the amount advanced on the last day of each month.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As
security for the performance of this Agreement, the other Loan Documents and the
payment of the Liabilities, each Borrower and Guarantor grants, pledges and
assigns to Lender a security interest in all assets of such Borrower or
Guarantor, whether now owned or hereafter acquired including, without
limitation, (a) all Accounts, Goods, Chattel Paper, Equipment, Documents,
Deposits, Instruments, General Intangibles and Payment Intangibles (including,
but not limited to, any and all interests in trademarks, service marks, patents,
licenses, permits, and copyrights), (b) all inventory of Borrowers, if any, held
by any Borrowers for sale or lease or to be furnished under contracts of
service, (c) all Books and Records, (d) any Account maintained by any Borrower
with Lender and all cash held therein, and (e) all proceeds and products of the
foregoing, including casualty insurance thereon (collectively, the
Collateral).
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Agreement provides for covenants as follows:
| | ------------------------------------------------

| | A. |  | Use of proceeds only for Working Capital, Letters of Credit and for acquisitions with
Lenders prior written consent.
| | -- |  | ---------------------------------------------------------------------------------------------------------------------

| | B. |  | Financial information to be furnished either annually, quarterly or monthly.
| | -- |  | ----------------------------------------------------------------------------

| | C. |  | Financial covenants to be tested as of the end of each fiscal quarter.
| | -- |  | ----------------------------------------------------------------------

| | D. |  | Limitations on loans and investments.
| | -- |  | -------------------------------------

| | E. |  | Compliance with laws and environmental matters.
| | -- |  | -----------------------------------------------

| | F. |  | Limitations on Borrowing.
| | -- |  | -------------------------

| | G. |  | Can not declare or pay any dividends.
| | -- |  | -------------------------------------

| | All
of the above and other items as per article VI of the Agreement. The Agreement
has a current expiration date of November 30, 2002.
| | --------------------------------------------------------------------------------------------------------------------------------------

| | The
Agreement with Able Oil Company and PNC Bank, dated August 11, 1999, was amended
July 14, 2000. The term was extended from June 30, 2001 to September 29, 2001.
The loan was paid in full effective September 29, 2001. The banking relation was
terminated and all collateral was being released by PNC Bank.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 5 |  | Note
Payable
|------ |  | ------------

| | The
Company has borrowed $500,000 from an unrelated individual. The Note is dated
June 26, 2001 with interest at 12% per annum. The interest will be paid monthly
at $5,000 per month commencing on August 1, 2001. The Note will mature on June
26, 2002 unless the borrower (the Company), at its option, elects to extend the
maturity date to December 26, 2002. The Note may be prepaid in whole or part
from time-to-time without penalty. At the maturity date, a final payment of the
unpaid principal and interest shall be due and payable. In connection with this
Note, the Company has issued the lender warrants to purchase 40,000 shares of
its common stock at $4 per share. The warrants vest immediately and must be
exercised no later than June 26, 2004.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 6 |  | Long-Term Debt
|------ |  | --------------

| | Mortgage
note payable dated, August 27, 1999, related to the purchase of B & B Fuels
facility and equipment. The total note was $145,000. The note is payable in the
monthly amount of principal and interest of $1,721.18 with and interest rate of
7.5% per annum. The initial payment was made on September 27, 1999, and
continues monthly until August 27, 2009 which is the final payment. The note is
secured by a mortgage made by Able Energy New York, Inc. on property at 2 and 4
Green Terrace and 4 Horicon Avenue, Town of Warrensburg, Warren County, New
York. The balance due on this Note at March 31, 2002 was $117,219.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Mortgage
note payable dated, August 31, 1999, related to the purchase of the facility and
equipment in Rockaway, New Jersey by Able Energy Terminal, LLC
(Terminal). The note is in the amount of $650,000.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Pursuant
to Section 4.4 of the Agreement of Sale to purchase the Terminal, the Principal
Sum of the $650,000 Note shall be reduced by an amount equal to one-half of all
sums expended by Borrower on the investigation and remediation of the property
provided, however, that the amount of said reduction shall not exceed $250,000
(the Remediation Amount).
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Principal Sum: Less the Remediation Amount shall be an amount
equal to $400,000 (the Reduced Principal Sum). The Reduced Principal
Sum shall bear interest from the date hereof at the rate of 8.25% per annum. Any
portion of the Remediation Amount not utilized in the investigation and
remediation of the property shall not begin to accrue interest until such time
that (i) a No Further Action Letter is obtained from the Department
of Environmental Protection and (ii) an outstanding lawsuit concerning the
property is resolved through settlement or litigation (subject to no further
appeals). All payments on this Note shall be applied first to the payment of
interest, with any balance to the payment to reduction of the reduced Principal
Sum. Based upon an amendment, dated November 5, 2001, and commencing with
interest due December 1, 2001, interest will be paid at the rate of 8.25% on the
principal sum of $650,000. Only interest is required to be paid and the
principal is due on July 31, 2004 (See Note 10).
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|17
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 7 |  | Income
Taxes
|------ |  | ------------

| | Effective January 1, 1997, the Company adopted Statement of Financial Accounting
Standards No. 109, Accounting for Income Taxes.
| | --------------------------------------------------------------------------------------------------------------------------------

| | The
differences between the statutory Federal Income Tax and Income Taxes Continuing
Operation is accounted for as follows:
| | ---------------------------------------------------------------------------------------------------------------------------

| | 2002                        
| | ----------------------------
|
| |                             
| | Statutory Federal Income Tax
| | State Income Tax            
| |                             
| | Income Taxes                
| |                             
| | Income Taxes consists of:   
| | Current                     
| | Deferred                    
| |                             
| | Total                       
| |                             
| |                             

| | 2001                        
| | ----------------------------
|
| |                             
| | Statutory Federal Income Tax
| | State Income Tax            
| |                             
| | Income Taxes                
| |                             
| | Income Taxes consist of:    
| | Current                     
| | Deferred                    
| |                             
| | Total                       
| |                             
| |                             

|18
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENT (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|----------------------------------------------------------------------------------------------------------------------------------

|Note 7 |  | Income
Taxes (contd)
|------ |  | ---------------------

| | The
types of temporary differences between the tax bases of assets and liabilities
and their financial reporting amounts that give rise to a significant portion of
the deferred tax liability and deferred tax asset and their approximate tax
effects are as follows at:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | March 31, 2002                 
| | -------------------------------
|
| |                                
| | Depreciation and Amortization  
| | Allowance for Doubtful Accounts
| | Gain on Sale of Subsidiary     

| | June 30, 2001                  
| | -------------------------------
|
| |                                
| | Depreciation                   
| | Allowance for Doubtful Accounts
| | Gain on Sale of Subsidiary     

| | 
| | 

| | Able Energy, Inc., et al, open years are December 31, 1998, 1999, 2000 and June
30, 2001. The Company has a net operating loss carryforward of approximately
$1,360,000. The net operating loss expires between June 30, 2019 and 2021.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | These
carryforward losses are available to offset future taxable income, if any. The
Companys utilization of this carryforward against future taxable income is
subject to the Company having profitable operations or sale of Company assets
which create taxable income. At this time, the Company believes that a full
valuation allowance should be provided. The component of the deferred tax asset
as of March 31, 2002 are as follows:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                             | 
|-------------------------------------------- | 
|Net Operating Loss Carryforward - Tax Effect | 
|Valuation Allowance                          | 
|                                             | 
|Net Deferred Tax based upon Net              | 
|Operating Loss Carryforward                  | 
|                                             | 
|                                             | 

|19
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

| |  | 
| |  | 

|Note 8 |  | Note
Receivable - Subsidiary
|------ |  | ----------------------------

| | The
Company has a Note Receivable from PriceEnergy.Com, Inc. for advances made in
the development of the Website, including hardware and software costs. All of
PriceEnergy.Com, Inc.s assets are pledged as collateral to Able Energy,
Inc. The amount of the note is $1,350,000 dated November 1, 2000 with interest
at 8% per annum payable quarterly. Principal payments to begin two years after
the date of the Note, November 1, 2002. Interest, in the amount of $81,000 has
been accrued for the nine months ended March 31, 2002. Unpaid accrued interest
due through March 31, 2002 is $153,000. The Note, accrued interest and interest
expense have been eliminated in the consolidated financial statements (See Notes
1 and 13). Able Oil Company has an accounts receivable for sale of heating oil
from PriceEnergy.Com, Inc. of $1,187,330 which has been eliminated in
consolidation against the accounts payable on PriceEnergy.Com, Inc.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 9 |  | Profit
Sharing Plan
|------ |  | -------------------

| | Effective
January 1, 1997, Able Oil Company established a Qualified Profit Sharing Plan
under Internal Revenue Code Section 401(K). The Company matches 25% of qualified
employee contributions. The expense was $23,331 (2002) and $19,822 (2001), for
the nine months ended March 31, respectively.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 10 |  | Commitments
and Contingencies
|------- |  | -----------------------------

| | The
Company is subject to laws and regulations relating to the protection of the
environment. While it is not possible to quantify with certainty the potential
impact of actions regarding environmental matters, in the opinion of management,
compliance with the present environmental protection laws will not have a
material adverse effect on the financial condition, competitive position, or
capital expenditures of the Company.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Able Oil Company is under contract to purchase #2 oil as follows:
| | -----------------------------------------------------------------

| | Company         |  | Period           |  | Total Gallons |  | Gallons OpenCommitment at3/31/02 |  | Open DollarCommitment at3/31/02
| | --------------- |  | ---------------- |  | ------------- |  | -------------------------------- |  | -------------------------------
| |                 |  |                  |  |               |  |                                  |  |                                
| | Conectiv Energy |  | 9/1/01 - 8/31/02 |  | 504,000       |  | 168,000                          |  | $120,792                       

| | Able
Oil Company is also under contract with Conectiv Energy to purchase Low Sulfur
Diesel Fuel for the period October 2001 through April 2002. The total is 294,000
gallons. 168,000 gallons in the year 2002, and an open purchase commitment of
42,000 gallons, $32,760 at March 31, 2002.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 10 |  | Commitments
and Contingencies (contd)
|------- |  | --------------------------------------

| | In
accordance with the agreement on the purchase of the property on Route 46,
Rockaway, New Jersey by Able Energy Terminal, LLC, the purchaser shall commence
after the closing, the investigation and remediation of the property and any
hazardous substances emanating from the property in order to obtain a No Further
Action letter from the New Jersey Department of Environmental Protection
(NJDEP). The purchaser will also pursue recovery of all costs and damages
related thereto in the lawsuit by the seller against a former tenant on the
purchased property. Purchaser will assume all responsibility and direction for
the lawsuit, subject to the sharing of any recoveries from the lawsuit with the
seller, 50-50. The seller by reduction of its mortgage will pay costs related to
the above up to $250,000 (see Note 6). A tentative settlement has been achieved
by the Company with regard to the lawsuit. The settlement provides for a lump
sum payment of $397,500 from the defendants to the Company. There is a current
agreement not finalized to increase this amount to $450,000. In return, the
defendants require a release from the Estate (the Seller) and a release and
indemnification from the Company. The defendants will provide a release to Able
Energy and the Estate. Pursuant to the original agreement, the Estate receives
50% of the settlement amount, net of attorney fees. This has been amended by an
agreement dated November 5, 2001. The entire settlement, net of attorney fees,
will be placed in an attorneys escrow account for payment of all
investigation and remediation costs.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
costs of the cleanup pursuant to the Agreement of Sale must be shared equally
(50/50) by the seller and purchaser up to Sellers cap of $250,000.
Sellers contribution to the cleanup is in the form of a reduction to the
Note and not by direct payments. In the opinion of management, the Company will
not sustain costs in this matter which will have a material adverse effect on
its financial condition.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Price
Energy.Com, Inc., a subsidiary, has commenced suit against ThinkSpark
Corporation on Consulting Services Agreement, dated June 2, 2000. ThinkSpark was
to provide services of professional quality performed by knowledgeable staff
familiar with the operation of the software and its application and conforming
to generally accepted data processing practices. ThinkSpark agreed that it could
develop, deliver and install the system to be operational by mid-August 2000.
ThinkSpark ceased work in mid-October 2000 and the project was not completed.
Price Energy hired another firm which is completing the project. ThinkSpark
admits the original estimate for the project was $266,000.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|21
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 10 |  | Commitments
and Contingencies (contd)
|------- |  | --------------------------------------

| | 
| | 

| | Price Energy paid ThinkSpark $82,539 and is paying the new firm $75,600 which
will complete the work.
| | -----------------------------------------------------------------------------------------------------

| | ThinkSpark
has filed a counterclaim seeking payment of $283,100.62, which is the total
amount of bills rendered. There is a liability of $107,861 in accounts payable
on the financial statements. This amount represents the original estimate of
$266,000, less payments, to ThinkSpark and the new firm hired to complete the
project. On January 11, 2002, Price Energy and ThinkSpark agreed to settle their
dispute. Price Energy will pay ThinkSpark $30,000 and there will be mutual
releases of all claims as well as dismissals of the pending actions in New
Jersey and Texas. Counsel is currently discussing the form of the settlement and
releases. The liability has been reduced to $30,000.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company in the normal course of business has been involved in several suits. Two
suits have been settled out of court at agreeable terms, according to
management. No suits are currently in litigation, except as noted above.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 11 |  | Operating
Lease
|------- |  | ---------------

| | Able
Energy Terminal, LLC, has acquired the following lease on the property it
purchased on Route 46 in Rockaway, New Jersey.
| | -----------------------------------------------------------------------------------------------------------------------------

| | The
lease with Able Oil Company, a wholly owned subsidiary of Able Energy, Inc., has
an expiration date of July 31, 2004. The lease provides for a monthly payment of
$1,200 plus a one cent per gallon through put, as per a monthly rack meter
reading.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Estimated
future rents are $14,400 per year, plus the one cent per gallon through put
charges per the monthly rack meter readings.
| | ----------------------------------------------------------------------------------------------------------------------------------

| | The
Company leased 9,800 square feet in the Rockaway Business Centre on Green Pond
Road in Rockaway, New Jersey. The facility will be used as a call center and
will combine the administrative operations in New Jersey in one facility. The
lease has a term of five (5) years from August 1, 2000 through July 31, 2005.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|22
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)


JUNE 30, 2001 AND
MARCH 31, 2002
|--------------------------------------------------------------------------------------------------------------------------

|Note 11 |  | Operating
Lease (contd)
|------- |  | ------------------------

| | The
rent for the first year is $7,145.83 per month and the second through fifth year
is $7,431.67 per month, plus 20.5% of the buildings annual operational
costs and its portion of utilities. The monthly rent, including Common
Area Charges, as of October 2000 is $9,084 per month. The lease does not contain
any option for renewal. The rent expense was $90,046 for the nine months ended
March 31, 2002. The estimated future rents are as follows:
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Year Ended June 30, |           | 
| | ------------------- | --------- | 
| |                     | 2002      | 
| |                     | 2003      | 
| |                     | 2004-2006 | 
| |                     |           | 
| |                     | Total     | 
| |                     |           | 

| | The following summarizes the month to month operating leases for the other subsidiaries:
| | ----------------------------------------------------------------------------------------

| |                     
| | --------------------
| | Able Oil Melbourne  
| |                     
| | Able Energy New York
| |                     

|Note 12 |  | Franchising
|------- |  | -----------

| | The
Company sells franchises permitting the operation of a franchised business
specializing in residential and commercial sales of fuel oil, diesel fuel,
gasoline, propane and related services. The Company will provide training,
advertising and use of Able credit for the purchase of product, among other
things, as specified in the Agreement. The franchisee has an option to sell the
business back to the Company after two (2) years of operations for a price
calculated per the Agreement. The Company signed its first franchise agreement
in September 2000. On June 29, 2001, PriceEnergy.Com Franchising, LLC, a
subsidiary, signed its first franchise agreement. The franchisee will operate a
B-franchised business, using the proprietary marks and a license from
PriceEnergy.Com, Inc. and will establish the presence of the franchisees
company on the PriceEnergy internet website. The franchisee will have the
exclusive territory of Fairfield County, Connecticut as designated in the
agreement. The franchisee paid the following amounts in July 2001:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  |  | 1. |  | A non-refundable franchise fee of $25,000.
| |  |  |  | -- |  | ------------------------------------------

| |  |  |  | 2. |  | An advertising deposit of $15,000 and a $5,000 escrow deposit.
| |  |  |  | -- |  | --------------------------------------------------------------

| | The non-refundable fee of $25,000 has been recorded as Other Income in the
period ended March 31, 2002.
| | -------------------------------------------------------------------------------------------------------

|23
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 13 |  | Related
Party Transactions
|------- |  | --------------------------

| | $44,690
is due from the major Shareholder/Officer of the Company. This amount is
evidenced by a Note bearing interest at a rate of 81⁄2% between the
Shareholder and the Company.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
following officers of this Company own stock in the subsidiary, PriceEnergy.Com,
Inc., which they incorporated in November 1999.
| | ------------------------------------------------------------------------------------------------------------------------------------

| |                        
| | -----------------------
| | Chief Executive Officer
| | President              

| | No capital contributions have been made by these officers (See Notes 1 and 8).
| | ------------------------------------------------------------------------------

|Note 14 |  | Earnings
Per Share
|------- |  | ------------------

| | The shares used in the computation of the Companys basic Earnings Per Common
Share are as follows:
| | ---------------------------------------------------------------------------------------------------

| | December 31,  2001                            | June 30,      2001
| | --------------------------------------------- | ------------------
| |                                               |                   
| | Weighted Average of Common Shares Outstanding |                   
| | Dilutive Effect of:                           |                   
| | Employee Stock Options                        |                   
| | Stock Warrants                                |                   
| |                                               |                   
| | Weighted Average Common Shares Outstanding    |                   
| |                                               |                   

| | The dilutive potential common shares that were antidilutive at March 31, 2002
amounted to 54,891 Shares.
| | --------------------------------------------------------------------------------------------------------

|Note 15 |  | Stock
Option Plans
|------- |  | ------------------

| | The
Company has stock option plans under which stock options may be issued to
officers, key employees, and non-employee directors to purchase shares of the
Companys authorized but unissued common stock. The Company also has a
stock option plan under which stock options may be granted to employees and
officers.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Options
granted currently expire no later than 3 to 5 years from the grant and have
vesting periods from none to 25% at grant and 25% each anniversary.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------

|24
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)

JUNE 30, 2001 AND
MARCH 31, 2002
|-------------------------------------------------------------------------------------------------------------------------

|Note 15 |  | Stock
Option Plans (contd)
|------- |  | ---------------------------

| |                   | Outstanding Options |       
| | ----------------- | ------------------- | ------
| |                   |                     |       
|
| |                   |                     |       
| | January 6, 2000   |                     |       
| | Grants            |                     | 56,000
| | Exercises         |                     | 0     
|
| | December 1, 2000  |                     |       
| | Grants            |                     | 48,090
| | Exercises         |                     | 1,250 
|
| | December 21, 2000 |                     |       
| | Grants            |                     | 60,000
| | Exercises         |                     | 0     
|
| | Grants            |                     | 24,000
| | Exercises         |                     | 0     

|Note 16 |  | Stock
Warrants
|------- |  | --------------

| | The
Company has issued stock warrants as follows:
| | -------------------------------------------------

| | 1. | 60,000 Common Stock Purchase Warrants at $4.81 per share, effective August 31,
2000, and expiring August 31, 2005, have been issued to Andrew Alexander Wise
& Company in connection with an investment banking advisory agreement with
the Company, dated July 1, 2000.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2. | 40,000 Common Stock Purchase Warrants at $4.00 per share, effective June 26,
2001 and expiring June 26, 2004, have been issued in connection with a $500,000
Note Payable (See Note 5).
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
40,000 warrants to purchase shares of common stock were outstanding during the
first quarter of 2002 and were included in the computation of diluted EPS as the
warrants exercise price was less than the average market price of the
common stock, which was $4.09 for the quarter ended March 31, 2002. Due to the
Companys Net Loss, the computation would be antidilutive (See Note 14).
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|25
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Contd)


JUNE 30, 2001 AND
MARCH 31, 2002
|--------------------------------------------------------------------------------------------------------------------------

|Note 17 |  | Compensated
Absences
|------- |  | --------------------

| | There
has been no liability accrued for compensated absences; as in accordance with
Company policy all compensated absences, accrued vacation and sick payment must
be used by December 31st. At March 31, 2002, any amount for accrual
of the above is not material and has not been computed.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|26
|--

|ABLE ENERGY, INC. AND
SUBSIDIARIES
|----------------------------------

|ITEM 2 |  | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------ |  | -------------------------------------------------------------------------------------

| | Statements in this
Quarterly Report on Form 10-QSB concerning the Companys outlook or future
economic performance, anticipated profitability, gross billings, expenses or
other financial items, and statements concerning assumption made or exceptions
to any future events, conditions, performance or other matter are forward
looking statements, as that term is defined under the Federal Securities
Laws. Forward-looking statements are subject to risks, uncertainties, and other
factors that would cause actual results to differ materially from those stated
in such statements. Such risks, and uncertainties and factors include, but are
not limited to: (i) changes in external competitive market factors or trends in
the Companys results of operation; (ii) unanticipated working capital or
other cash requirements and (iii) changes in the Companys business
strategy or an inability to execute its competitive factors that may prevent the
Company from competing successfully in the marketplace.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Revenue
Recognition
| | -------------------

| | Sales of fuel and heating
equipment are recognized at the time of delivery to the customer, and sales of
equipment are recognized at the time of installation. Revenue from repairs and
maintenance service is recognized upon completion of the service. Payments
received from customers for heating equipment service contracts are deferred and
amortized into income over the term of the respective service contracts, on a
straight-line basis, which generally do not exceed one year.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Results
of Operations
| | ---------------------

| | Nine months ended March 31, 2002, compared to the nine months ended March 31,
2001.
| | -----------------------------------------------------------------------------------

| | The Company reported
revenues of $21,368,992 for the nine months ended March 31, 2002, a decrease of
24.76% over the prior years revenues for the same nine-month period. This
decrease can be attributed primarily to a decrease in the cost of product
(mainly home heating oil) and the resulting lower retail sales price, which was
sold by the Company below the price of the prior year, and the abnormally warm
weather in the winter of 2002.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|
|

| | Gross profit margin, as a
percentage of revenues, for the nine months ended March 31, 2002, increased to
19.82% from 14.97%. For the quarter ended March 31, 2002 the Gross Profit
increased to 23.99% from 17.13%. The increase in margin is primarily a result of
the Companys new margin management policy. This program, which was
introduced in September of 2001, is designed to maximize margins, by product
segment, on each of the products and services that it markets to the consumer.
This program is designed to promote product pricing that is in line with the
specific type of service provided.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Selling, General and
Administrative expenses decreased by $511,488, or 11.50%, from $4,445,831 for
the nine months ended March 31, 2001 to $3,934,343 for the nine months ended
March 31, 2002. The lower costs resulted from a decrease in payroll, repairs,
consulting fees, and advertising. The overall decrease in SG&A was achieved
even with the operations of a new subsidiary, PriceEnergy.com, included in the
results of this year but not last year as PriceEnergy.com began its operations
in October of 2000. PriceEnergy had salaries, advertising, and computer
consulting costs of approximately $143,000 for the three months ended September
30, 2001.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Operating loss for the nine
months ended March 31, 2002 was $557,416, a decrease of 38.02% over the
Companys operating loss of $899,350 for the nine months ended March 31,
2001. The Operating Income for the quarter ended March 31, 2002 increased to
$452,972 from $182,122 for the quarter ended March 31, 2001. This increased
operating income for the quarter ended March 31, 2002 and the decreased loss for
the nine months ended March 31, 2002 was directly attributable to the lower
SG&A expenses and sales at higher margins.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company had a profit of
$695,467 for the three months ended March 31, 2002 without its subsidiary,
PriceEnergy.com. Total Company results for the nine months ended March 31, 2002
was a period to period decrease of $117,016, or 16.39%, to $596,833 as compared
to the loss during the same period the previous year of $713,849. This net loss
was the result of a new subsidiary, Price Energy which had a nine-month loss of
$783,509 and a three month loss for the quarter ended March 31, 2002 of
$278,580. The subsidiary began operations in October 2000. Other causes that
reduced income included warmer weather. The entire Northeast, which includes the
Companys main area of operations, experienced the warmest Winter season in
125 years which also significantly reduced income during the most recent quarter
and first nine months of this fiscal year. In addition, interest income
decreased and the Companys gross margin was lower during the quarter ended
September 30th 2001, prior to full implementation of the new margin
management program.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|
|

| | Operational
Efficiency
| | ----------------------

| | The Company believes that
it can continue to significantly increase the utilization of existing personnel
and equipment, thereby reducing expenses and increasing profitability, within
its current business configuration.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In September of 2001, the
Company implemented a new margin management program which is a policy and system
that was designed to increase profitability without sacrificing customer appeal.
The Company believes that there is value to the products and services that it
provides to its consumers in varying levels based upon the specific needs of the
consumer and the products provided. Within the new margin matrix that the
Company has implemented, product pricing has been put into line with the level
of service and specific product packages provided to the consumer. For those
consumers requiring more in depth or full-service, prices have been adjusted
appropriately to match the level of the services provided. This new margin
management program has already begun to yield positive results for the Company
as evidenced by the 6.9% and 4.9% increase in Gross Profit for the
3rd quarter and nine month period, respectively.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | This is also evidenced by
an increase in gross profit from 15% to 21.6% for the months of October through
December 2001 vs. 2000 and 17.13% to 23.99% in the period January through March
2002 vs. 2001. The Company believes that this trend of increasing gross profit
will continue through the quarter and year ending June 30, 2002.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Recently
Implemented Technological Procedures
| | ---------------------------------------------

| | The Company has established
goals, which will be accomplished through the implementation of some modern
technologies that are currently being installed into the Companys existing
infrastructure.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company believes, in
the current down economy, that it can significantly increase its ability to
provide superior customer service from its Rockaway Call Center while at the
same time operating its administration more efficiently through the use of newly
installed Customer Relationship Management software. By utilizing existing
telephony hardware and in-house management, the Companys call center
environment will be provided with the ability to respond to changing call
patterns, both higher and lower, without the expense of clerical over-staffing
to meet unrealized needs. Full implementation and integration of this software
has now been completed.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Companys full
implementation of the previously announced Automated Dispatch Technology is 75%
complete as of quarter ending March 31, 2002. This technology will enable the
organization to increase the efficiency, productivity, and profitability of its
equipment service and fuel delivery dispatch systems.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|
|

| | Within
the home heating equipment service environment, this technology is providing
management with the ability to communicate with service technicians
instantaneously via wireless CDPD technology to perform billing functions at the
customers location and receive and input payment information remotely. In
addition, management will be aware of the status of every on-duty worker and
provide real time reporting for stand-by, enroute, and service work time thus
maximizing scheduling opportunities and eliminating service technician down
time. Vehicles will be equipped with GPS to track the ongoing location, ground
speed, and vehicle movement history for both service and delivery personnel. It
is expected that the Company will have full implementation of this technology on
all of its service vehicles by the quarter ending March 31, 2002.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Liquidity and Capital Resources
| | -------------------------------

| | For the nine-month period
ended March 31, 2002, compared to the nine months ended March 31, 2001, the
Companys cash position decreased by $158,999 from $530,165 to $371,166.
For the year ended June 30, 2001, cash was generated through operations,
collections of customer advance payments, and increase loan from an outside
individual. The primary reason for reduction in cash was a loan and investment
in PriceEnergy.com, Inc.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the nine months
ended March 31, 2002, cash was generated through collection of customer advance
payments and a new credit facility with Fleet Bank.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company has entered
into an agreement with Fleet National Bank. The bank has granted the Company a
credit facility of $1,500,000. This will enable the Company to continue to grow
while strengthening its infrastructures. The Company has entered into an
agreement with PricewaterhouseCoopers Securities, LLC to assist the Company in
raising debt or equity funds up to $15 million.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Seasonality
| | -----------

| | The Companys
operations are subject to seasonal fluctuations, with a majority of the
Companys business occurring in the late fall and winter months.
Approximately 70% of the Companys revenues are earned and received from
October through March, most of such revenues are derived from the sale of home
heating products including propane gas and home heating oil. The warmer weather
in the six months ended March 31, 2002 reduced the sale of heating oil by
approximately 14.3%. The heating season, September through March, resulted in a
32% decrease in degree-days, comparing the period in the years 2001 and 2000.
The Company still continued to grow its customer base in the period ended March
31, 2002. The seasonality of the Companys business is offset, in part, by
an increase in revenues from the sale of HVAC products and services, diesel and
gasoline fuels during the spring and summer months, due to the increased use of
automobiles and construction apparatus.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|
|

| | From May through September,
Able Oil can experience considerable reduction of retail heating oil sales.
Similarly, Able Propane can experience up to 80% decrease in heating related
propane sales during the months of April to September, this is offset somewhat
by increased sales of propane gas used for pool heating and fuel for outdoor
cooking equipment.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Over 90% of Able
Melbournes revenues are derived from the sale of diesel fuel for
construction vehicles, and commercial and recreational sea-going vessels during
Floridas fishing season, which begins in April and ends in November. Only
a small percentage of Able Melbournes revenues are derived from the sale
of home heating fuel. Most of these sales occur from December through March,
Floridas cooler months.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|PART II OTHER
INFORMATION
|-------------------------

|Item 1. |  | Legal Proceedings
|------- |  | -----------------

| | None.
| | -----

|Item 2. |  | Changes in Securities and Use of Proceeds
|------- |  | -----------------------------------------

| | None.
| | -----

|Item 3. |  | Defaults Upon Senior Securities
|------- |  | -------------------------------

| | None.
| | -----

|Item 4. |  | Submission of Matters to a Vote of Security Holders
|------- |  | ---------------------------------------------------

| | None.
| | -----

|Item 5. |  | Other Information
|------- |  | -----------------

| | None.
| | -----

|Item 6. |  | Exhibits and Reports on Form 8-K
|------- |  | --------------------------------

| | (a) Exhibits
| | ------------

| | None.
| | -----

| | (b) Reports
on Form 8-K
| | -----------------------

| | The Company did not file any reports on Form 8-K during the nine months ended
March 31, 2002.
| | ---------------------------------------------------------------------------------------------

|
|

|SIGNATURES
|----------

|Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Date: May 15, 2002 |  | ABLE ENERGY, INC.By: /s/ Christopher Westad       
       Christopher Westad       President
|------------------ |  | ----------------------------------------------------------------------------------------------------------